The International Energy Agency (IEA) expects the market for critical minerals used in green energy technologies will expand rapidly as nations look to curb their carbon emissions.

In a new report, the IEA said the market for metals used in the production of electric vehicles and renewable power generation, could grow “sevenfold” in the next decade under an ambitious plan to reach net zero emissions by 2050.

More than 110 nations have already committed to the drastic reduction target, according to figures from the UN.

The IEA expects this rapid increase in demand will bolster revenues for producers of the key metal groups in coming years.

“Revenues from those minerals are larger than revenues from coal well before 2030. This creates substantial new opportunities for mining companies,” the agency’s report found.

“It also creates new energy security concerns, including price volatility and additional costs for transitions, if supply cannot keep up with burgeoning demand.”

Oil demand to grow at fastest rate since ‘70s

The uptick in green energy metal demand isn’t expected to hamper demand for oil, with separate IEA research forecasting a 6% rebound in 2021.

That would be the largest increase in demand for ‘black gold’ since 1976, the agency said, and would be the fastest post-pandemic rebound of all fuel types.

Supply cuts made by OPEC+ nations in response to last year’s drastic drop in demand means the oversupply seen throughout 2020 has reduced back to more normal levels.

But the rapid return of mobility as restrictions ease and vaccine rollouts continue is expected to drive demand up faster than supply can keep pace, the IEA cautioned.

The agency forecasts demand to grow from 93.1 million barrels per day in the first quarter of 2021, to 99.6 million barrels per day by the end of the year.

Sources:

• IEA: Net Zero by 2050. A Roadmap for the Global Energy Sector
• IEA: Global Energy Review 2021
• IEA: Oil Market Report – May 2021
• UN News: The race to zero emissions, and why the world depends on it